Making money on cattle

[SF]

What would his note be?

I don't think you were addressing me Wewild, but I'll respond anyway. Around here, his note payment on the 150 acres would be between $20,400 and $30,000 per year depending upon the parcel of land purchased. Less if he were to be creative with the structure of the mortgage.

You got the land at between $2,000 and $3,000 per acre. That would be low here and probably in FL.

Add in $100,000 in cows and $100,000 in equipment and facilities.

That would put his cost just on the note at between $325 and $450 per calve sold.


He might have a tough row to hoe.

No doubt about it. I've stated in previous posts that it is very difficult if not impossible to pay for land with cattle. Not saying it can't be done, but one is going to have to find a niche market to accomplish this.

 

[Crowderfarms]

What would his note be?

I don't think you were addressing me Wewild, but I'll respond anyway. Around here, his note payment on the 150 acres would be between $20,400 and $30,000 per year depending upon the parcel of land purchased. Less if he were to be creative with the structure of the mortgage.

You got the land at between $2,000 and $3,000 per acre. That would be low here and probably in FL.

Add in $100,000 in cows and $100,000 in equipment and facilities.
That would put his cost just on the note at between $325 and $450 per calve sold.


He might have a tough row to hoe.

Still would be a tough nut to bust even if you Inherited the Land, Cattle came with it all, and the Equipment was paid for. You still have to have resources to maintain your equipment and your Cattle, and everything else in general.

 

[Wewild]

What would his note be?

I don't think you were addressing me Wewild, but I'll respond anyway. Around here, his note payment on the 150 acres would be between $20,400 and $30,000 per year depending upon the parcel of land purchased. Less if he were to be creative with the structure of the mortgage.

You got the land at between $2,000 and $3,000 per acre. That would be low here and probably in FL.

Add in $100,000 in cows and $100,000 in equipment and facilities.
That would put his cost just on the note at between $325 and $450 per calve sold.


He might have a tough row to hoe.

Still would be a tough nut to bust even if you Inherited the Land, Cattle came with it all, and the Equipment was paid for. You still have to have resources to maintain your equipment and your Cattle, and everything else in general.

Taxes and hay eat us up. Another $120 per calf.

 

[SF]

I just don't wear blinders about operating cost.

Nor do I

You are not helping people wanting to try cattle and if it was easy everyone would be doing it.

I admire all who are willing to try something new, especially as it relates to agriculture. I think I am helping, by encouraging and offering positive comments to there endeavor.

I have been playing this game since the mid seventies.

Sorry, but it's not a game to me. If involves money, I take it serious. That is the difference between us.

You would benifit if you would study the difference between gross income and net income.

I'm a pretty good accountant too. I know the difference between gross and net.

I'm sure you and I are not the smartest guys on the planet, so why is it so hard to believe that someone out there might just be making a lot of money with cattle?

 

[Caustic Burno]

Crowder Ah your ledgers are not in braile.

SF you are out of your leauge with Camp. He does raise real Herefords.

 

[SF]

Crowder Ah your ledgers are not in braile.

SF you are out of your leauge with Camp. He does raise real Herefords.

CB;
I actually have a high degree of respect for Camp. I have read many of his posts and I learn from him on a regular basis. He is one of the people who posts things on this board that I admire and respect the things he posts. I believe you are right he is out of my league.
You can call me by my name. I don't mind.
Greg

 

[bigbull338]

yes you can make money like that. but your puming it right back into the ranch . though bank notes buying cattle buying trucks an all. if an when you retire . taxes and debt eat up as much as they can. not saying you cant make money in debt. just that if you stumble you can lose it fast an its gone. scott

 

[Greenhorn]

Well a few of the things I plan to try to increase my viablitity are

1. Farm a few acres to feed the family and can vegetables for winter as my grandparents did.

2. Sell excess produce at the farmers market.

3. Raise poultry for family and sale.

4. If it gets tight, lease to some hunters.

5. Try to direct market beef.

I am gonna use an old Ford tractor inherited from my grandfather and just alot of manuel labor. I am trying to keep front end costs to a minimum so my monthly outlay is as small as possible. How do you guys do this? Hell I may even try to solar power my house. As I stated in my first post I am still in the planning and saving money stage.

SF, you mentioned getting creative with a mortgage. Can you expand on this? What kind of options are there? Do you guys Incorporate your ranches for tax purposes? LLP's? This is the kind of info that can help us beginers.

-Greenhorn

 

[SF]

SF, you mentioned getting creative with a mortgage. Can you expand on this? What kind of options are there? Do you guys Incorporate your ranches for tax purposes? LLP's? This is the kind of info that can help us beginers.

-Greenhorn

There are several options available. The one I like the best is the "interest" only mortgage. This will lower your monthly payment significantly. When you have surplus years you can always pay down your principal at your discretion, but it lowers your obligation for the tight years. There are many options for mortgages, depending upon your individual situation. PM if you want more info. I'll send you my email address and we can correspond in more detail.

Each state is different, but I don't usually recommend incorporating. Doesn't protect you from yourself anyway. An LLC (Limited Liability Company) will provide you with the same basic protections of a Corporation, but decreases the paperwork. LLP's are usually designed more for lawyers, archecticts, doctors, etc...

Hope this helps

 

[Wewild]

SF, you mentioned getting creative with a mortgage. Can you expand on this? What kind of options are there? Do you guys Incorporate your ranches for tax purposes? LLP's? This is the kind of info that can help us beginers.

-Greenhorn

There are several options available. The one I like the best is the "interest" only mortgage. This will lower your monthly payment significantly. When you have surplus years you can always pay down your principal at your discretion, but it lowers your obligation for the tight years. There are many options for mortgages, depending upon your individual situation. PM if you want more info. I'll send you my email address and we can correspond in more detail.

Each state is different, but I don't usually recommend incorporating. Doesn't protect you from yourself anyway. An LLC (Limited Liability Company) will provide you with the same basic protections of a Corporation, but decreases the paperwork. LLP's are usually designed more for lawyers, archecticts, doctors, etc...

Hope this helps

I thought raw land loans were much different from mortgages. Can you get an interest only loan on investment property?

 

[SF]

SF, you mentioned getting creative with a mortgage. Can you expand on this? What kind of options are there? Do you guys Incorporate your ranches for tax purposes? LLP's? This is the kind of info that can help us beginers.

-Greenhorn

There are several options available. The one I like the best is the "interest" only mortgage. This will lower your monthly payment significantly. When you have surplus years you can always pay down your principal at your discretion, but it lowers your obligation for the tight years. There are many options for mortgages, depending upon your individual situation. PM if you want more info. I'll send you my email address and we can correspond in more detail.

Each state is different, but I don't usually recommend incorporating. Doesn't protect you from yourself anyway. An LLC (Limited Liability Company) will provide you with the same basic protections of a Corporation, but decreases the paperwork. LLP's are usually designed more for lawyers, archecticts, doctors, etc...

Hope this helps

I thought raw land loans were much different from mortgages. Can you get an interest only loan on investment property?

I think Greenhorn is talking about living on the land, therefore it is not investment property, it is a homestead. As a homestead it will qualify for interest only.

In addition, if you are looking for land for agricultural purposes there are numerous options for very low interest loans for these purchases.

Regarding investment property. There are creative ways to structure investment property loans also, however you will be more limited with them. I would not recommend traditional investment property loans for agricultural purposes. There is not enough flexibility with these types of loans.

 

[Wewild]

I think Greenhorn is talking about living on the land, therefore it is not investment property, it is a homestead. As a homestead it will qualify for interest only.

In addition, if you are looking for land for agricultural purposes there are numerous options for very low interest loans for these purchases.

Regarding investment property. There are creative ways to structure investment property loans also, however you will be more limited with them. I would not recommend traditional investment property loans for agricultural purposes. There is not enough flexibility with these types of loans.

Around here banks start having problems with home loans on property over 5 acres.

Couldn't get a conventinal loan on 17 acres and a house in '97.

We had to go through GA Farm Credit for 10 years. Had to pay down a fair amount too.

Just been my experience.

 

[SF]

I think Greenhorn is talking about living on the land, therefore it is not investment property, it is a homestead. As a homestead it will qualify for interest only.

In addition, if you are looking for land for agricultural purposes there are numerous options for very low interest loans for these purchases.

Regarding investment property. There are creative ways to structure investment property loans also, however you will be more limited with them. I would not recommend traditional investment property loans for agricultural purposes. There is not enough flexibility with these types of loans.

Around here banks start having problems with home loans on property over 5 acres.

Couldn't get a conventinal loan on 17 acres and a house in '97.

We had to go through GA Farm Credit for 10 years. Had to pay down a fair amount too.

Just been my experience.

I just finished building a house on 25 acres. Did not have any problem. Conventional loan.

You are correct, there are some banks that won't go over 5 acres, some set their limit at 10 acres, some 20 acres. There are some that just don't care about the acreage. You will have more success achieving this type of financing through an independent mortgage broker. They will represent hundreds of banks and lending institutions.

 

[Wewild]

I just finished building a house on 25 acres. Did not have any problem. Conventional loan.

You are correct, there are some banks that won't go over 5 acres, some set their limit at 10 acres, some 20 acres. There are some that just don't care about the acreage. You will have more success achieving this type of financing through an independent mortgage broker. They will represent hundreds of banks and lending institutions.

First off, hello to everyone. I have been reading the posts for a couple days and dedcided to register and ask a few questions. I am looking to make the move into the cattle business and am in the process of learning and planning at the moment. My experience is somewhat limited. As a youngster my Grandfather in Oklahoma ran cattle and I would help out in the summer. I am currently raising exotics with my brother in law who has a place in the Texas Hill Country. We keep a herd of goats to provide some cash flow throughout the year. His place is not very conducive to raising cattle. So all in all not to much experience but enough to have made up my mind that this is the lifestyle I want to pursue. This decision is based on many things including quality of life, better environment to raise my kids, and a love of the outdoors, animals, and hard work (hehe, yes I like to work!).

I am in the planning stages right now and I am saving like a madman to get the necessary capital to start with. Looking at the price of land and the sale price of cattle I am having a hard time making the numbers work. I am not looking to get rich, just pay the bills. I am thinking of 200 acres and a cow/calf operation. I know answers may vary alot, and some questions may be vague and apply in one situation but not another and so on. What I am looking for is how you do it on your ranch to make a living. So here goes...

1. Is it generally better or more cost efficient to keep bulls for breeding or to AI?

2. Any trick or tips on financing the land and/or herd to make it profitable?

3. What to look for in a piece of land?

4. Is there a "best" age/weight to sell calves at?

5. What is the timeline on weight gain (generally speaking)? In other words what do they usually weigh at 3 months, 6 months, 9 months 12 months?

6. Should I set aside land for raising hay for the winter or how is hay production set into the grazing rotation?

Thanks in advance for any answers and all of the future help that this board will undoubtably provide.

-Greenhorn

I think he might have a problem trying to finance 200 acres of raw land and what ever type of house he decides to build under you suggestions. Institutions that loan money can see through all the crap.

Their going to be looking at a LTV they can understand.

 

[SF]

Wewild;

I don't think he will have any trouble trying to finance 200 acres and a house. I know of a couple of banks here that will loan you money for your house and 1000 acres if that is what you are looking for. Each area of the US is different, so maybe that isn't possible in your area. I don't claim to know what goes on in all areas of the US. But I know in my part of the world it is certainly possible. Heritage Land Bank is one such bank that will loan you money (conventional loan) here in Texas for land and home. They don't care how much land. Your loan will be based upon your credit and your ability to repay the loan. Kind of the way most banks work.

You can check them out for yourself at http://www.heritagelandbank.com/

 

[Wewild]

Your loan will be based upon your credit and your ability to repay the loan. Kind of the way most banks work.

I'd say that's the kicker. I quess he wouldn't tell them what he had in mind.

 

[Wewild]

You can check them out for yourself at http://www.heritagelandbank.com/

Checked your link and it don't give nothing but the sales pitch. You done business there or did you do a internet search?

 

[SF]

You can check them out for yourself at http://www.heritagelandbank.com/

Checked your link and it don't give nothing but the sales pitch. You done business there or did you do a internet search?

Done business there.

 

[Wewild]

Done business there.

I take it you covered the financing with your first job.

 

[Muratic]

Done business there.

I take it you covered the financing with your first job.

:shock: :roll: :cboy: